In a speech to be delivered at a meeting of Group of 20 finance ministers and central bank chiefs in Shanghai, Carney also blamed the recent global slump in shares and other asset prices on the failure of governments to make bold reforms of their economies.

“The global economy risks becoming trapped in a low-growth, low-inflation, low-interest rate equilibrium,” he said in the speech which suggested governments might consider boosting demand by raising their own borrowing and spending.

Concerns about the extent of a slowdown in the world economy have mounted since the start of the year and analysts say the risks of a new global recession are growing.

Carney earlier this week said the BoE might cut interest rates further or expand its bond-buying programme if needed, but would not follow the lead of the European Central Bank and the Bank of Japan which have cut their key lending rates below zero.

In his speech on Friday, Carney said around a quarter of global output was now coming from produced in economies where policy rates were “literally through the floor.”

“It is critical that stimulus measures are structured to boost domestic demand, particularly from sectors of the economy with healthy balance sheets,” he said. “There are limits to the extent to which negative rates can achieve this.”

And when negative rates are used in ways that insulate retail customers while allowing wholesale rates to adjust, the main effect on economies was through exchange rates.

“From an individual country’s perspective this might be an attractive route to boost activity,” Carney said. “But for the world as a whole, this export of excess saving and transfer of demand weakness elsewhere is ultimately a zero-sum game.”

“Moreover, to the extent it pushes greater savings onto the global markets, global short-term equilibrium rates would fall further, pulling the global economy closer to a liquidity trap. At the global zero bound, there is no free lunch.”

Carney said central banks were not able to take the world economy into a period of higher growth on their own and there was a need for domestic and international policy coordination.

“For example, lower interest rates create space for fiscal policy to boost domestic demand directly, should it be necessary, by lowering the financing cost faced by governments,” he said.

Carney also said the push to prevent the build up of risks in the financial sector would lead the Financial Stability Board, grouping regulators from around the world and which Carney heads, to recommended measures to reduce “structural vulnerabilities” in the asset management sector.